by Leo Jakobson | February 01, 2018

If you run an incentive, recognition or reward program of any type, you probably need to read the Incentive Research Foundation's (IRF) recently posted white paper, "Summary of Legal Issues Affecting Non-Cash Award Programs."

There's two simple reasons for this. First, giving employees anything of value, for any reason, is complex thanks to the Internal Revenue Service, the Department of Labor, and a variety of state and federal tax codes and other regulations. 

Second, a recent survey by the Incentive Research Foundation found that just two thirds of incentive program owners even know that these regulations exist, and fewer than two in five consider themselves "very knowledgeable" about them.

For a whitepaper covering a topic that delves into topics such as the IRS Code -- specifically Section 274(j) - as well as the ins and outs of the Occupational Safety and Health Administration, among other regulations like anti-money laundering rules (they're not kidding), it's surprisingly easy to read. And it was written by George B. Delta, Esq., executive director and counsel of the Incentive Federation -- an industry umbrella organization - who has many, many years of experience in the incentive industry.


The white paper is divided into five sections:


--Employee achievement programs (notably service and safety awards)
-- The Department of Labor's investment advice rules (particularly as they pertain to financial firms' programs)
--Gift cards (which are affected by a number of state laws as well)
--The Anti-Money Laundering Rule (crooks like gift cards, it seems)
--Sales and use tax issues with non-cash awards

A link to the Summary of Legal Issues can be found at the top of the IRF's "U.S. Federal Regulations and Non-Cash Awards" study (sponsored by MotivAction) which focused on program owners' familiarity with incentive and recognition regulations.